A Phoenix-based start-up company has developed a system to allow for secure check writing over the Internet and is now seeking a bank partner to help get it off the ground.

Netchex officials say their system provides merchants and computer network users with a secure and inexpensive way to make on-line check payments.

Though other start-ups have created payment systems and software that may allow for credit or even debit card transactions, few, if any, have tackled the risks entailed with securing on-line checks.

Netchex is admittedly small and new; it finished running mock transactions with its core product only recently.

But its executives are nonetheless thinking big, shopping for a banking partner or acquirer to provide clearing house services and some needed capital.

It has been courting a number of noteworthy institutions - NationsBank Corp. and Cardinal Bancshares among them. And Netchex officials say they have also been talking with technology-focused banking groups, like the Financial Technology Consortium.

Netchex is open to arrangements with any of these organizations. But the company's priority lies in lining up a bank to process the check information.

Without this crucial service, the company is not yet ready to test its product with real transactions involving merchants and Internet users.

But the ability to process is not enough. Robert H. Moore, the company's president, said that Netchex is "actively pursuing a strong financial partner," whose name could bring the company some instant respect and attention in the marketplace.

What Netchex can offer a bank in return, Mr. Moore said, is the ability to handle the most popular noncash form of payment over the increasingly popular pipeline of computer networks.

Mr. Moore said that last year there were six times as many retail transactions using checks as credit cards.

"People with credit cards must, by necessity, have a checking account," Mr. Moore said.

Unlike most systems to secure credit and debit card payments, the Netchex service is not based on public key, two-way encryption.

Instead, Mr. Moore said, the system is predicated on very specific, proprietary hardware and software configurations. Customers' actual accounts are protected by use of "shadow accounts" - a 16-digit number assigned to each Netchex customer - and by various levels of coding based on specifics of the account and the user.

David E. Saxton, the executive vice president for Netchex, said that this high-tech system was, in many ways, a safer means for handling checks than more conventional options.

"To be as secure as Netchex, banks would have to have a handwriting expert looking at every check," Mr. Saxton said.

Initially, both the software and the check writing itself will be free to consumers, although Mr. Moore said there may be charge of a 10 to 15 cents a check "down the road."

Merchants must pay 2% of the check's face value or $1 - which ever is higher - per check, plus a $10 monthly maintenance charge.

Michael S. Karlin, an executive vice president for Cardinal Bancshares and the soon-to-be president of First Security National Bank, a Internet bank Cardinal plans to spin off, met with Netchex to explore a possible relationship.

Although First Security is not getting into electronic commerce, Mr. Karlin said the bank intends to offer an on-line bill payment service that may closely resemble or incorporate a system like Netchex.

Ellison Clary, a spokesman for NationsBank, said his bank had also been in discussions with Netchex. Although the bank "never talks about acquisitions" prematurely, Mr. Clary said the bank is very interested in offering its customers the capability to write checks over the Internet.

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